Irish Mortgage Brokers Blog

The upcoming price increases in electricity are due to a PSO (public service obligation) under which €72 million Euro will be paid to firms who dig up peat bogs to burn (and also to wind farms: which is more acceptable but not nearly as easy to make fun of) for energy. Peat bogs are actually a carbon fixer, they remove carbon from the atmosphere and fix it into the soil.

Richard Tol said it best “Approximately, the amount of carbon released into the atmosphere when burning peat is the same as the amount of carbon captured in the bog. Let’s be generous and assume that we subsidize peat burning at 78 euro/tCO2. The market value of CO2 is 14 euro/tCO2. So, we spend 78 euro to destroy 14 euro, which makes 92 euro/tCO2. Fortunately, we do this for about 1 million tonnes only”.